Hi and welcome to our site!If none of the profits were distributed and was not required to be distributed - the form K1 is not required.NOL will stay with the estate and unused deductions will be passed to beneficiaries on the final tax return (final K1) when the estate is closed.If anything were distributed previously should not affect the distribution on the final tax return.
Another loss in 2012 -
The answer is what I expected, but since this estate is being fought out in court, I wanted to be certain that I was correct.
So, if the property is distrusted in 2012,, can I show the property distribution on the 2013 k-1.? If I wait for the final return to file any K"1's I don't know the proper way to show the property distrustions of the corpus from a prior year.
Perfect - I did see that the K-1 on the 1041 has no place for property distributions, but I knew the beneficiaries needed something to show basis of the rental property.
Your understanding is correct.
Only items that affect income tax return of beneficiaries are reported on K1.
The distribution of the corpus is not required to be reported.
You may however report the distribution of the corpus on line 14 as Other information.
If the only item to report is the corpus distribution - you still MAY issue K1, but it is not required.
Some additional comments are passed by MequonCPA:
Any distribution of assets by the trust is assumed to be income first. The fact that the trustee chose to distribute real estate rather than cash doesn't change the sequence.